Home CryptocurrencyAltcoin 4 tips that will keep your cryptocurrencies safe from hackers in this bull market

4 tips that will keep your cryptocurrencies safe from hackers in this bull market

by SuperiorInvest

Cryptocurrency users and projects should keep their heads sharp ahead of the next bull market, keeping an eye out for untrustworthy exchanges, unsecured decentralized finance (DeFi) protocols, and ever-evolving phishing scams.

In January, hackers launched 30 attacks and made off with more than $182.5 million in stolen funds, up 771% year-over-year from January 2023 and up nearly 84%. bulk since December, according to PeckShield data.

February was also shaping up to be a record month for exploiters, with more than $380 million stolen, more than double that of January. At least $290 million was stolen from PlayDapp alone, along with $26 million from FixedFloat and $9.7 million from Axie Infinity co-founder Jeff Zirlin.

“Education is the first line of defense in keeping cryptocurrencies safe,” Chainalysis cybercrime research leader Eric Jardine told Cointelegraph. “For users, awareness is always important.”

Jardine said cryptographic protocols typically have broad transparency due to their open source development. Great for users who want to audit code, but also opens up opportunities for bad actors who can “scan scripts for vulnerabilities and plan exploits well in advance.”

“Do your research on DeFi platforms and protocols before interacting with them,” Jardine said. “Understand their features and security strategy, and look for updates on the platform on how they are improving them.”

Check, then check again

In 2023, more than 324,000 cryptocurrency users were affected by phishing scams, with a loss of around $295 million, Scam Sniffer analysis shows.

The anti-scam platform told Cointelegraph that “social media has the most scam links,” noting that malicious websites are often linked in ads on these platforms.

Beosin security researcher Pan Tao warned that phishing attacks announced on X disguised as Ethereum staking and token airdrops “have been frequent and effective recently.”

On February 25, phishing attackers compromised MicroStrategy's X account and stole at least $440,000, draining wallets in an airdrop of fraudulent tokens.

the attacker reportedly directed users to a similar website, microsfrategy.com.

A screenshot of the fake MicroStrategy website replaced the T in the company name with an F. Source: X

Scam Sniffer said users should always verify that the website URL is correct from multiple sources and understand what a contract does before signing a transaction.

Meanwhile, Tao warned that drain-as-a-service tools, such as those used in the fake airdrop, have become a “mature and convenient phishing tool,” and attackers are known to advertise scams on Google and X.

Have a secure CEX

Beosin's Tao said many new cryptocurrency users will purchase their first digital assets on a centralized exchange (CEX) owned and operated by an entity.

At the same time, there have been “several CEX scams,” including the theft of customer funds by FTX and alleged fraud by JPEX on its users.

Tao suggested that the criteria for choosing a centralized and secure exchange should start with ensuring that it is licensed “or at least publishes its proof of reserves periodically.”

It should also have “no withdrawal issues or high withdrawal fees” along with “timely customer support and clear answers.”

Save those private keys

DeFi protocols should ensure their security efforts cover vulnerabilities on and off the blockchain, Jardine said.

On-chain vulnerabilities, such as in smart contracts, “drove most of the DeFi hacking activity in 2023,” Jardine noted. “This changed throughout the year, with compromised private keys driving a higher proportion of attacks in the second half of the year,” he added.

Related: ZK testing presents security challenges for developers

“The key takeaway for DeFi protocols is that their security efforts should cover more than just on-chain vulnerabilities and smart contracts, especially amid the rise of off-chain vulnerabilities.”

Projects can create systems to monitor activity on the chain for potential vulnerabilities, Jardine suggested.

He noted that some companies offer products that can alert and react to cyber attacks, helping secure third-party integrations and “communicate with customers who may be at risk.”

Jardine said Chainalysis has seen improvements in DeFi protocol security practices and highlighted that losses from protocol hacks fell approximately 64% year-over-year to $1.1 billion by 2023.

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